Iran's Fast, Furious, and Filthy Rich

by ALI CHENAR in Tehran

[ dispatch ] On a typical Friday, the official day off in Iran, Asadollah Allam, a confidant of the late Shah and a former prime minister, liked to go horseback riding out of town. On his way to the stable one day, in his fancy American car, he recalled seeing "women and men on their way back from their Friday bath, a few soldiers in their ugly boots enjoying their time off, and kids playing in the dirt" -- "poverty, pure and simple," as he put it.

"I then thought of Communist countries where such scenes are common," he continued, writing in his memoirs in the late 1970s, not long before class tensions helped fuel the Iranian Revolution. "But in those countries, at least no one drives the latest luxury Cadillac through such neighborhoods," he added.

Three decades later, under a leadership that promised the masses greater social and economic equality, such ostentatious displays of disparity have become far more commonplace.

"There are more Porsches on the streets of Tehran than in many American cities," an Iranian expat said on a recent visit. There may be a grain of truth to his observation. The German automaker, which entered the Iranian market last year, reportedly sold out of its annual allocation for the country before August. And how the situation in Iran's capital compares statistically to any other major city may not be as important as the perception it creates, especially in a society whose rulers still govern in the name of the oppressed.

"I know people have the right to enjoy their money," said Hamid, a 32-year-old accountant. "But when there are many who can't afford bread and basic necessities in this city, seeing a multimillion-dollar car on the street tells you something is very wrong with our economy."

The source of wealth in Iran, and Tehran in particular, raises a lot of eyebrows. "No one knows where it comes from," says a graduate student of economics. "However, the oil price hikes have created so much revenue for the government, those billions must have ended up somewhere."

European car manufacturers have taken note. Last year, Porsche opened a dealership in Tehran's western suburbs to great fanfare. The opening ceremony, at which Iranian businessmen mingled with Porsche representatives, received substantial media coverage. The dealership covers 12,000 square meters and includes a retail shop, an exhibition hall, and on-site service facilities. According to a blogging car enthusiast, Porsche sales director Andreas Offerman, on hand for the event, declared, "Iran has been a white spot on the Porsche map for too long and we are glad that we are here after two years of deliberate planning,"

Porsche's successful entry into the Iranian market has encouraged other manufacturers to make similar plans. Roughly a year after Porsche began its operations in the Islamic Republic, an Italian business daily revealed that Maserati, Fiat's high-end brand, aims to open a dealership through a representative in Tehran next year.

Fiat is majority owner of the Chrysler Group, based in the United States, which has extensive restrictions on trade and financial transactions with Iran. "Our cars are produced entirely within Italy and we don't have any embargo," Umberto Cini, Maserati managing director for the Middle East and Africa, toldThe Gulf.

The carmaker's sales in the UAE appear to have played a role in its decision. Roughly a third of Maserati customers in the sheikhdom are Iranian. Still, there's more to the Maserati move. "I know that the main focus of that deal actually isn't the high-end sports cars, it's the mass-market Fiats," a well-informed source told Tehran Bureau. "Fiats will be sold through the same dealership. Maserati attracts attention, so it's a form of marketing." At the end of the day, "very few people can afford those in Tehran."

Others manufacturers are almost certain to follow Maserati. "So many companies are accessing the Iran market, and I think the war talk only emboldens them," said the source. "They want to establish themselves before any prospective regime change." Range Rover, a large luxury four-wheel drive sport utility vehicle produced by Britain's Land Rover firm, was on its way. "They were going [to Iran] last year," said the source. "Dealership land was bought, the service bay was being set up." Even at more than $100,000 each, plus an import tariff of at least 110 percent, "they had presold dozens of cars."

But they got hit up with sanctions -- retaliatory sanctions imposed by Iran itself. The Islamic Republic has a ban on goods originating from Great Britain, at least those not previously granted importation rights.

Despite that setback, it's all good news for Iran's nouveau riche, who once upon a time suffered from a lack of access to the latest playthings due to the country's isolation. Today, their children are living out the dreams of the elder generation.

Even more than in the West, automobiles are a symbol of drivers' social status. But how times have changed. "In the '70s and '80s, if you were a young athletic kid, you were driving a Paykan Javanan, or a Hilman Talbot sports car with rings and extra speakers," said Nasser, a 45-year-old taxi driver. "If you were a bazaari, you had a Mercedes-Benz." To an unusual degree, Mercedes and BMW have long been more than just transportation in Iran: "These are the cars that say you have made it."

Ali, an engineer, remembers buying Masheen (Car) every month as a teenager in the 1980s to catch a glimpse of the latest designs. "Just reading about the latest Lamborghini, Ferrari, and presidential-armored Mercedes would get me excited."

His friend Pedram, 36, a mechanical engineer, chimes in: "My dream was not to have a BMW, just to drive one for a day before I die." Pedram used to collect car cards and posters. "Today, in the streets of Tehran, I see cars whose photo alone would have made me very happy as a kid."

Last June in a report for Shargh, a reformist daily, Reza Gheybi described his encounter with this generation's young and loaded:

I approached a Porsche 630, its driver, a 20-year-old named Saam, leaning on his car. "What are you writing about?" he said, apparently referring to his own German sports vehicle. "These cars are so passé!" When I asked him why he likes cars, Saam said, "It is better than smoking hookahs."

Saam eventually took the reporter on a tour of popular spots for car racers around the capital. Venturing the streets of Velenjak, an affluent section of north Tehran, Gheybi met Bardia, the owner of the most expensive car in the city: a Bugatti Veyron valued at $3 million. "Driving this car, I feel like a king in Tehran," he declared. Bardia reportedly knows everyone in the capital's underground racing world. For Bardia, having a Bugatti is "a way of getting invitations to parties and enjoying life."

Bardia's only wish is to be able to get a license plate for his car and to find some roads for speed racing. To have his beloved Bugatti plated, he will have to pay the hefty import tariff, bringing his outlay to more than $6 million.

Gheybi also visited an auto shop that handles high-end foreign vehicles. He was not allowed to take any pictures, but the owner told him the cost of an average service check: around $10,000 -- the price of a domestically manufactured car.

The Shargh report was quoted widely by media outlets representing every side of the Iranian political spectrum, all echoing concerns about the ungodly gap between rich and poor. "You should remember the Revolution and the political establishment have always advocated equality and promised the oppressed a better life," said a retired economist. "Their understanding of equality was more in line with leftist ideologies. For people in our society to see a multimillion-dollar car alongside a Paykan, valued at two to four thousand dollars, is a sign of not having achieved that equality."

Hamid, who had made a similar observation, pointed out, "The teenager talking on his cellphone driving a BMW sports car haphazardly at high speeds on Tehran's highways is so common it's not just confined to a few individuals, it's become a stereotype."

Meanwhile, for Bardia and many others like him, finding a road for racing is the priority. "This is our Europe, there is no difference between Tehran and Europe," he proclaimed. For Bardia's crowd, wrote Gheybi, "Today Tehran is a city of palaces, wild parties, and multimillion-dollar cars." And it seems for the nouveau riche, that is all that matters.

Consider the Tehran-Qom Highway. Driving through the capital's busy Navvab district or around the Azadi Square loop, you hardly dare to roll your windows down. There are enough gas fumes and soot to shake the healthiest constitution. Rows of cabs and private cars block the roads waiting for passengers. Gridlock barely begins to describe it. Then, somehow, you manage to make it onto the highway. Suddenly, all that oppression is gone. You find yourself moving through an open desert. Free. Free of traffic, free of pollution, free of all those mental burdens. Here you can let go, and many do. The highway is infamous for illegal racing.

Nasser, the taxi driver, described a crash he saw a couple of weeks ago. "A BMW X-6 was racing with a Nissan Maxima. Both drivers were doing 140 miles per hour. All I could do was to get off the road. Whizzing past me, the driver of the Maxima lost control. The car spun around and slammed into the X-6." He added, his voice touched with pity, "A $300,000 car became a piece of crap in a minute." He did not say whether there were any fatalities. Perhaps the value of the car seemed more important.

The incident to which Nasser bore witness is far from an isolated one. Car racing is one of Tehran's most popular underground pastimes. There are unofficial racing clubs, whose members keep track of each other's scores, challenge each other, wager and brag. These clubs even design new racing routes. Drivers routinely dare each other into performing dangerous maneuvers, at the risk of their own lives. Two weeks ago, Ali, a 35-year-old engineer, was driving in north Tehran when two cars flew past him. "One was a KIA Sportage SUV, the other I think was a Mazda 3. They were fast, very fast. Suddenly, they went for a right turn at an intersection. The Sportage was too fast. It hit a tree at the juncture. The left wheel collapsed, and the driver's head hit the windshield, leaving him unconscious."

Automotive fatalities are high to begin with -- according to Iranian officials there are 120 accidents for every 10,000 vehicles in Iran. In March and April this year alone, 3,353 people were killed in road accidents, which are the country's leading, non-health-related cause of death. Despite its contribution to that lethal record, racing seems only to be growing in popularity. Indeed, it is surely one of the factors impelling the construction of a five-kilometer Formula One racetrack just south of Tehran.

To again invoke Iran's once Communist neighbor to the north, perhaps some in Iran are aware of what Keith Gessen observed in the New Yorker last year: "The first great post-Soviet fortune...was made not from oil or gas or nickel: that came later. It was made when Boris Berezovsky, a mathematician and game theorist, started selling cars."

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